Tag Archives: North Salem Luxury Real Estate

Real Estate Prices Stay Strong in Westchester | North Salem Real Estate

WESTCHESTER COUNTY, NY — Real estate sales in the lower Hudson Valley slowed a little in the third quarter of 2017, according to a report from the Hudson Gateway Association of Realtors. That is because prospective homebuyers were operating in a market that has seen reductions in the supply of for-sale housing over the past four years.

In terms of price, the market is still strong.

“The 2017 year to date sales figures continue to trend significantly higher than the previous year for most of the lower Hudson region,” they said. (For more stories on local real estate, sign up for Patch’sdaily newsletter, news alerts and updates.)

Meanwhile, the double-digit percentage rate of shrinking inventory is continuing, HGAR officials said: down 16 percent in Orange, 16 percent in Putnam, 15 percent in Rockland and 8 percent in Westchester as compared to third quarter 2016.

They predicted the market will remain vibrant, citing . conditions including attractive mortgage rates, high employment and a healthy economy.

 

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https://patch.com/new-york/peekskill/real-estate-prices-stay-strong-westchester-county

Decline for April Sales Masks 2017 Gains | North Salem Real Estate

Contracts for new single-family home sales fell more than expected in April, declining 11.4% to a 569,000 seasonally adjusted annual rate according to estimates from the joint data release of HUD and the Census Bureau. The decline occurred after solid, positive revisions for new home sales for the first three months of the year.

All told, total new home sales for 2017 stand at 210,000, a 11.3% gain over the 2016 comparable total of 189,000.

NAHB expects new home sales to continue to progress along the established, modest growth trend due to ongonig job growth, improving household formations, continuing favorable housing affordability conditions, and tight existing home inventory.

Inventory growth continued in April. After hovering near 240,000 for most of 2016, inventory has now risen to 268,000. The current months’ supply number stands at a healthy 5.7. Given tight existing inventory, more new homes are required to meet housing demand.

The most recent data also indicate a growing share of homes not-started in builder inventory. For example, on a year-over-year basis, homes under construction in inventory have increased by a little more than 6% over the last year. Completed, ready-to-occupy homes (there are only 59,000) are up 2% since April of last year. In contrast, homes not-started listed in inventory have increased 42%, from 36,000 in April of 2016 to 52,000 last month.

Pricing data in the April report find that the median sales price of new homes sold in April was $309,200, while the average price was $368,300. These levels are below the 2016 annual totals but remain higher than the 2015 data.

Regionally, all areas saw monthly declines in sales in April. Sales were down 26% in the West, 13% in the Midwest, 8% in the Northeast and 4% in the South. As with the national headline number, the monthly numbers obscure growth for 2017. On a year-to-date basis, new home sales are up 26% in the Midwest, 15% in the Northeast, 10% in the South and 7% in the West compared to April of 2016.

 

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http://eyeonhousing.org/2017/05/decline-for-april-sales-masks-2017-gains/

New Single-Family Home Size Continues to Trend Down | North Salem Real Estate

After increasing and leveling off in recent years, new single-family home size continued along a general trend of decreasing size during the start of 2017. This change marks a reversal of the trend that had been in place as builders focused on the higher end of the market during the recovery. As the entry-level market expands, including growth for townhouses, typical new home size is expected to decline.

According to first quarter 2017 data from the Census Quarterly Starts and Completions by Purpose and Design and NAHB analysis, median single-family square floor area was slightly lower at 2,389 square feet. Average (mean) square footage for new single-family homes declined to 2,628 square feet.

On a less volatile one-year moving average, the recent trend of declines in new home size can be see on the graph above, although current readings remain elevated. Since cycle lows (and on a one-year moving average basis), the average size of new single-family homes is 10% higher at 2,624 square feet, while the median size is 14% higher at 2,402 square feet.

The post-recession increase in single-family home size is consistent with the historical pattern coming out of recessions. Typical new home size falls prior to and during a recession as home buyers tighten budgets, and then sizes rise as high-end homebuyers, who face fewer credit constraints, return to the housing market in relatively greater proportions. This pattern was exacerbated during the current business cycle due to market weakness among first-time homebuyers. But the recent declines in size indicate that this part of the cycle has ended and size will trend lower as builders add more entry-level homes into inventory.

In contrast to single-family patterns, new multifamily apartment size is down compared to the pre-recession period. This is due to the weak for-sale multifamily market and strength for rental demand

 

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http://eyeonhousing.org/2017/05/new-single-family-size-continues-to-trend-down/

Mortgage rates average 4.15% | North Salem Real Estate

Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing average mortgage rates slightly falling for the second consecutive week.

News Facts

  • 30-year fixed-rate mortgage (FRM) averaged 4.15 percent with an average 0.5 point for the week ending Feb. 16, 2017, down from last week when it averaged 4.17 percent. A year ago at this time, the 30-year FRM averaged 3.65 percent.
  • 15-year FRM this week averaged 3.35 percent with an average 0.5 point, down from last week when it averaged 3.39 percent. A year ago at this time, the 15-year FRM averaged 2.95 percent.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.18 percent this week with an average 0.4 point, down from last week when it averaged 3.21 percent. A year ago, the 5-year ARM averaged 2.85 percent.

Average commitment rates should be reported along with average fees and points to reflect the total upfront cost of obtaining the mortgage. Visit the following link for the Definitions. Borrowers may still pay closing costs which are not included in the survey.

Quote
Attributed to Sean Becketti, chief economist, Freddie Mac.

“For the last 46 years, the 30-year mortgage rate has been almost perfectly correlated with the yield on the 10-year Treasury, but not this year. From Dec. 29, 2016, through today, the 30-year mortgage rate fell 17 basis points to this week’s reading of 4.15 percent. In contrast, the 10-year Treasury yield began and ended the same period at 2.49 percent. While we expect mortgage rates to fall into line with Treasury yields shortly, this just may be a year full of surprises.”

Housing bubble is probably more myth than reality | North Salem Real Estate

 

If you own a home and you’ve visited real estate information websites Zillow, Trulia, Redfin, or any of the like recently, you’ve probably noticed an interesting trend: Your home is increasing in value at a rate that’s far and away higher than the national rate of inflation.

Is housing bubble 2.0 around the corner?

According to the S&P Case-Shiller Home Price Index, which tracks residential real estate prices nationally, as well as within 20 large metropolitan regions, residential real estate prices rose 5.3% between Aug. 2015 and Aug. 2016. By comparison, the national measure of inflation, the Consumer Price Index, has moved higher by a little more than 1% over the trailing 12-month period.

If we back the data out a bit further, the outperformance of housing prices becomes even more apparent. Real housing prices — essentially home price increases with inflation backed out — have risen by 25% just since 2012, and are now sitting at their highest point since the Great Recession. This is noteworthy considering that in the 107 years between 1890 and 1997, housing prices generally tracked the national inflation rate very closely, at least based on data from Robert Shiller in the book Irrational Exuberance. Only over the past two decades have we witnessed a diversion from the mean, with the first diversion leading to a massive housing bubble that’s still fresh in the minds of many homeowners.

This latest outperformance in housing prices, as well as the fresh memory of the recent housing collapse less than one decade prior, has some pundits predicting that housing bubble 2.0 could be right around the corner. A Dec. 2015 interview with 66 industry experts conducted by Zillow found that more than 10 believed the Boston, Los Angeles, and Miami markets were at risk of entering a bubble, while even more pundits believed New York and San Francisco were already there.

Images

IMAGE SOURCE: ARMCHAIRBUILDER.COM VIA FLICKR.

Home prices can continue to soar

However, it’s possible these industry experts could be completely wrong. Based on the evidence available at the moment, I’d contend that we’re not even close to a bubble in housing prices, and that home prices could very well outpace the national rate of inflation for many years to come.

Let’s have a closer look at why home prices could keep soaring.

1. Supply constraints

The biggest factor that could push home prices continuously higher is the trade-off between homebuilder supply and homeowner demand. According to Jesse Edgerton, an economist at J.P. Morgan, most national markets simply don’t have the homebuilder supply to meet demand, and that’s unlikely to change anytime soon.

In an interview with Yahoo! Finance, Edgerton had this to say:

One might wonder if these high prices reflect growing demand that could soon elicit a wave of construction that would prove our forecasts wrong. We find, however, that high prices are concentrated in markets where supply is constrained by geography or regulation, suggesting there may be little room for additional construction.

Data from J.P. Morgan indicates that while housing prices are rebounding rapidly from their recessionary lows, homebuilders appear content in increasing their supply at only a modest pace. Furthermore, the areas where an expansion of construction would appear to be beneficial — San Jose, Los Angeles, San Francisco, and so on — are also the areas that are the most limited in their ability to respond to an increase in demand.

It’s tough to predict how homebuilders will respond if prices continue to climb. For some builders, the allure of profits may be too great to ignore. However, if homebuilders can prudently manage their supply growth, they’ll likely encourage home prices to head higher at a rate that handily outpaces inflation.

 

2. A continuation of the low-lending-rate environment

Secondly, the ongoing low-lending-rate environment should continue to spur demand for new homes.

A home is arguably the largest purchase Americans will make during their lifetimes, and historically low mortgage rates could be the catalyst that coerces prospective homeowners to pull the trigger. Even more appealing is the fact that many Americans have far better FICO credit scores than they had a decade prior, meaning they’d probably qualify for sweeter deals from lenders.

Based on data released by FICO last year, the national average FICO score of 695 was an all-time high. Comparatively, the national average FICO score in Oct. 2005 was 688. FICO’s data showed a 3% increase in the number of consumers with a FICO score above 800 compared to the prior decade (FICO scores max out at 850), with a 2.1% decline in consumers with a FICO score under 550. Long story short, Americans appear to be in better shape than ever when it comes to getting a mortgage.

Though the Federal Reserve is the “X factor” here, and it can be completely unpredictable, the case for raising the federal funds target rate isn’t that strong. Inflation remains below the Fed’s target level, job creation has been up and down in 2016, and external factors, such as Brexit and China’s slowing GDP growth, could weigh on the growth outlook in the United States. After aiming for four interest-rate hikes in 2016, it’s quite possible the Fed ends the year without making a single move, which favors the continuation of a low-lending-rate environment.

 

3. The “rent” vs. “buy” trade-off

Over the longer term, the trade-off between renting and buying a home would also seem to favor rising housing prices.

If interest rates do normalize over the long term and head back to around 3%, it would presumably work in favor of the rental market. Higher interest rates mean higher mortgage rates, which in turn should push on-the-fence homebuyers back into renting. When this happens, landlords become privy to significant rental pricing power and are able to increase rental rates well above the national rate of inflation. Just the expectation of rising interest rates at some point soon has been pushing rental prices around the country higher, at a pace that’s well above the national inflation rate.

However, there comes a tipping point in the renting vs. buying trade-off where rental prices increase enough that buying a home actually becomes the cheaper option on a monthly basis. It happened to me in 2007, and it could very well happen to millions of Americans as rental inflation increases.

 

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http://www.fool.com/mortgages/2016/11/07/no-were-not-in-a-housing-bubble-and-yes-home-price.aspx

Dreamy rooftop garden | North Salem Real Estate


The garden will be open to neighbors

All photos by Hiroyuki Oki via Designboom

Never ones to shy away from throwing in alltheplants, Vietnamese architecture firm  Vo Trong Nghiatakes the roof terrace to the next level in this new home in Nha Trang, Vietnam. The firm, working in collaboration with architect Masaaki Iwamoto, made the most of local construction rules—which required a sloped roof that’s at least half-covered in grey or terracota tiles—by creating a dreamy stepped garden brimming with all sorts of flowers, trees, and shrubbery.

The living spaces underneath are like an extension of the garden. Built around airy, vegetated interior courtyards, the living, dining, and bedrooms feel breezy and lush. The polished wood plank floors, white brick walls, and high ceilings certainly also help bring in as much light as possible.

garden1
garden2

 

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Existing homes sales surge | North Salem Real Estate

Existing home sales, as reported by the National Association of Realtors (NAR), surged 14.7% in December, including an increase in the first-time buyer share to 32%, the highest share since August. December sales snapped back from a November decline partially attributable to delays in closings from the rollout of the Know Before You Owe mortgage disclosure rule by the Consumer Financial Protection Bureau (CFPB). The new rule was designed to help consumers understand their loan options and avoid closing cost surprises. Total existing home sales in December increased to a seasonally adjusted rate of 5.46 million units combined for single-family homes, townhomes, condominiums and co-ops, up from 4.76 million units in November. December existing sales were up 7.7% from the same period a year ago.

Existing Home Sales December 2015

Existing sales increased in all regions, ranging from 8.7% in the Northeast to 23.2% in the West. Year-over-year, all regions increased, ranging from 4.6% in the South to 11.9% in the Northeast.

Total housing inventory decreased by 12.3% in December, and is 3.8% lower than its level a year ago. At the current sales rate, the December unsold inventory represents a 3.9-month supply, down from a 5.1-month supply in November. Some 32% of homes sold in December were on the market for less than a month.

The distressed sales share decreased to 8% in December from 9% in November. Distressed sales are defined as foreclosures and short sales sold at deep discounts. The December all-cash sales share decreased to 24% from 27% in November and 26% in December 2014. Individual investors purchased a 15% share in December, down from 16% in November and 17% a year ago.

The December median sales price of $224,100 was 7.6% above last December, and represents the 46thconsecutive month of year-over-year increase. The median condominium/co-op price of $209,900 in December was up 4.9% from last December.

 

http://eyeonhousing.org/2016/01/existing-sales-surge/

Homeowners Still Overvalue their Homes | North Salem Real Estate

Average appraised values in December were 1.8 percent lower than homeowners’ opinion of their home’s value, marking the 11th straight month when appraised values were lower than homeowners expected, although the gap between the two values has narrowed since August.

The Quicken Loans’ national Home Value Index (HVI) – a measure of home values based on recent appraisals used in to refinance mortgages – showed that home values continuing to climb in December. Appraised values increased a modest 0.18 percent from November, but have risen a steady 5.81 percent since December 2014 and 3.8 percent since the beginning of the year.quickenn

Appraised values continued to fall below homeowner estimates in December. On average, appraiser opinions were 1.8 percent lower than the value homeowners expected, according to the national HPPI. Many of the metro areas studied also showed perception moving closer to equal. Appraisals remained higher in Western cities, while homeowner expectations topped appraised values in many of the Northeastern and Midwestern cities examined.

“The narrowing of the perceived vs. appraisal value gap is an excellent way to end the year,” said Quicken Loans Chief Economist Bob Walters. “The more homeowners are in line with appraisers, and understand the equity in their home, the easier it will be to refinance their mortgage. In the same vein, if homebuyers understand how the local market is performing, they will be better equipped to come in with a strong offer on the home of their dreams.”

2016-01-14_11-42-46

Appraisals remain a significant cause of delay or termination of sales contracts.  Of all contracts settled or terminated, financing, appraisal, and home inspection issues were the major problems: 18 percent had financing issues, 13 percent had home inspection issues, and 11percent had appraisal issues, said the National Association of Realtors in its October Realtor Confidence Index.

 

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http://www.realestateeconomywatch.com/2016/01/homeowners-still-overvalue-their-homes/

 

Housing Construction Trends Heat Up in June | North Salem Real Estate

Total housing starts expanded 9.8% month over month in June, reaching a 1.174 million annual starts pace, which was led by a surge in multifamily development.

Single-family starts were effectively flat, recording a 0.9% monthly decline to a 685,000 seasonally adjusted annual rate but were up 14.7% year over year. As measured on a three-month moving average, the pace of single-family starts hit a post-recession high in June. Looking forward, single-family permits were up 0.9% for June and 6% year-over-year, reaching a 687,000 annual rate. Regionally, single-family starts were up 6.8% for the month in the South, but down 27.3% in the Northeast, 7.1% in the West, and 4% in the Midwest.

Pointing to future growth, the July NAHB/Wells Fargo Housing Market Index reached 60 in July, which is the highest level since November 2005. Two of its three components also rose to levels last seen in late 2005. The index of current sales rose one point from the June level to 66, the highest in 10 years. The index for expected sales rose two points from June’s 69 to 71, also the highest in almost 10 years. The index for traffic fell one point to 43 from the six-month high in June of 44.

And more good news from June: The National Association of Realtors measure of existing home salesexisting home sales increased 3.2%, reaching the highest level since February 2007. Given that most new home sales are to move-up buyers, a rise in the volume of existing sales bodes well for additional single-family construction. Inventory of resale homes continues to be limited, falling to a five-month supply in June as the current sales rate.

However, the standout of the June housing starts report was multifamily construction, which for units in buildings with five or more units climbed to a 476,000 annual rate with a 28.6% monthly growth rate. Permits also expanded greatly, jumping 16.1% to a 621,000 annual rate. NAHB expects this level of apartment development to cool in the coming months.

On the supply side of the market, the most recent Producer Price Index data from the BLS revealed a small increase for wood products in June after trending down for the start of 2015. Softwood lumber prices rose 1% for the month but are down 9.1% from a recent high in September 2014. Prices for OSB rose 2.4% in June after a 20.4% slide that followed the collapse in prices that ended in July 2013. Gypsum prices slipped 1.5% in June after being flat in May, increasing to 5.3% the retreat from a February peak.

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http://eyeonhousing.org/2015/07/eye-on-the-economy-housing-construction-trends-heat-up-in-june/

CoreLogic: May home prices rose 6.3% nationally | North Salem Real Estate

May home prices nationwide, including distressed sales, increased by 6.3% in May 2015 compared with May 2014, according to the home price report from CoreLogic(CLGX).

This change represents 39 months of consecutive year-over-year increases in home prices nationally. On a month-over-month basis, home prices nationwide, including distressed sales, increased by 1.7% in May 2015 compared with April 2015.

“Mortgage rates on 30-year fixed-rate loans remained below 4% through May, helping to fuel home-purchase activity,” said Frank Nothaft, chief economist for CoreLogic. “Our homes-for-sale listing data shows that markets with high demand and limited supply, such as San Francisco, are recording double-digit appreciation rates over the past year.”

Including distressed sales, 33 states and the District of Columbia were at or within 10% of their peak prices in May 2015.

Ten states and the District of Columbia reached new price peaks not experienced since January 1976 when the CoreLogic HPI started. These states include Alaska, Colorado, Iowa, Nebraska, New York, North Carolina, Oklahoma, Tennessee, Texas and Vermont.

Click to enlarge

(Source: CoreLogic)

Excluding distressed sales, home prices increased by 6.3% in May 2015 compared with May 2014 and increased by 1.4% month over month compared with April 2015. Excluding distressed sales, only Massachusetts (-2%) and Louisiana (-0.2%) showed year-over-year depreciation in May. Distressed sales include short sales and real estate-owned transactions.

The CoreLogic HPI Forecast indicates that home prices, including distressed sales, are projected to increase by 0.9% month over month from May 2015 to June 2015 and by 5.1% on a year-over-year basis from May 2015 to May 2016. Excluding distressed sales, home prices are projected to increase by 0.8% month over month from May 2015 to June 2015 and by 4.7% year over year from May 2015 to May 2016.

The CoreLogic HPI Forecast is a projection of home prices using the CoreLogic HPI and other economic variables. Values are derived from state-level forecasts by weighting indices according to the number of owner-occupied households for each state.

“The rate of home price appreciation ticked up in May with gains being fairly widely distributed across the country. Importantly, higher home prices over the past couple of years have spurred increases in new single-family construction,” said Anand Nallathambi, president and CEO of CoreLogic. “Sales of newly built homes during the first five months of 2015 were up 23% from a year ago, and as rising values build equity for homeowners, we expect to see more existing homes offered for sale in the coming year.”

 

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http://www.housingwire.com/articles/34393